Jurisdiction - China
Reports and Analysis
China – New Beijing Arbitration Commission Rules To Offer ‘More Professional Procedures’.

27 January, 2015

 

 
The Beijing Arbitration Commission (BAC) has published new arbitration rules that will enter into force on 1 April 2015.
 

According to the BAC, a not-for-profit body, the new rules are designed to provide a “more professional procedure” to settle disputes amid the “growing complexity of business activities”.

 

Highlights of the new rules  include “breakthrough” provisions for claims involving multiple parties.

 

The BAC said to better handle such cases, the new rules allow arbitration to move beyond “the traditional model of claims only between claimants or only between respondents”. Any party will be able to raise claims against any other party under the same arbitration agreement, an approach to resolve disputes between multiple parties not only conveniently, but also cost-effectively”, the BAC said.

 

In addition, the BAC said it could decide to consolidate two or more pending arbitrations “into a single arbitration, intending to provide the parties in complex cases with more procedural benefits”, if requested by one or more parties and if the BAC “considered it necessary”.

 

The new rules also recognise that “commercial arbitration is a cross-border legal service”, the BAC said. “To provide qualified services to more and more global parties, the new rules have widely adopted international practice in its international commercial arbitration procedure, which have been well integrated with Chinese local circumstances. This can be deemed as the best example of the new rules’ inclusiveness, openness, and internationalisation.”

 

In respect of language to be used in arbitral proceedings, the BAC said the new rules adhere to “the principle of party autonomy”. “In the absence of the parties’ agreement, the new rules do not simply go for Chinese, but give the BAC or the arbitral tribunal the final say on the selection of language(s) according to the specific circumstances of the case.” BAC proceedings could also be conducted in multiple languages, allowing parties involved in international arbitrations to “enjoy more linguistic conveniences”.

 

According to the BAC, “existing Chinese laws are silent as to whether an arbitral tribunal has the authority to order any interim measures”. However, laws in some jurisdictions grant arbitral tribunals the power to make such orders, which are also enforceable before local courts, the BAC said.

 

“On the purpose of a broader protection of the parties’ legal rights, the new rules confirm the arbitral tribunal’s power to order any interim measures it deems proper in accordance with the applicable law,” the BAC said. “To support this provision, the new rules also provide for an ‘emergency arbitrator’ mechanism, in response to any possible request for interim measures before the constitution of the arbitral tribunal.

 

In a separate move, China’s oldest arbitration centre has also updated its rules for 2015 in order to “adapt to the newest developments in international arbitration practice” while at the same time accounting for agreements that make reference to the breakaway Shanghai and Shenzhen sub-commissions.

 

The 2015 Chinese International Economic and Trade Arbitration Commission (CIETAC) rules came into effect on 1 January 2015. They introduce an emergency arbitration procedure, in line with that offered by other international arbitration centres; along with new rules on single arbitration for multiple contracts, ‘joinder’ of third parties to an existing arbitration and consolidation.

 

References:

 

Please click the link below for more information.

 

A Brief Introduction of Beijing Arbitration Commission Arbitration Rules 2015 (8-page / 90 KB PDF)

 

Pinsent Masons

 

For further information, please contact:

 

Michael Fenn, Partner, Pinsent Masons

michael.fenn@pinsentmasons.com

 

Homegrown Dispute Resolution Law Firms in China

 

International Dispute Resolution Law Firms in China

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